Assessor Resource

BSBSMB402
Plan small business finances

Assessment tool

Version 1.0
Issue Date: April 2024


This unit describes the skills and knowledge required to identify financial requirements of a business, including profit targets, cash flow projections and strategies to garner financial support.

It applies to individuals who operate a small business or work within an existing micro or small businesses and interpret financial data.

No licensing, legislative or certification requirements apply to this unit at the time of publication.

You may want to include more information here about the target group and the purpose of the assessments (eg formative, summative, recognition)


Evidence Required

List the assessment methods to be used and the context and resources required for assessment. Copy and paste the relevant sections from the evidence guide below and then re-write these in plain English.

ELEMENT

PERFORMANCE CRITERIA

Elements describe the essential outcomes.

Performance criteria describe the performance needed to demonstrate achievement of the element.

1. Identify costs, calculate prices and prepare profit statement

1.1 Identify and document costs associated with production and delivery of business products and services

1.2 Calculate prices based on costs and profit margin, as an hourly charge-out rate for labour or unit price for products

1.3 Calculate breakeven sales point to establish business viability and profit margins

1.4 Identify appropriate pricing strategies in relation to market conditions to meet business profit targets

1.5 Prepare projected profit statement to supplement the business plan

2. Develop a financial plan

2.1 Set profit targets or goals to reflect owner’s desired returns

2.2 Identify working capital requirements necessary to attain profit projections

2.3 Identify noncurrent asset requirements and consider alternative asset management strategies

2.4 Prepare cash flow projections to enable business operation in accordance with business plan and legal requirements

2.5 Identify capital investment requirements accurately for each operational period

2.6 Select budget targets to enable ongoing monitoring of financial performance

3. Acquire finance

3.1 Identify startup and ongoing financial requirements according to financial plan/budget

3.2 Identify sources of finance, including potential financial backers, to provide required liquidity for the business to complement business goals and objectives

3.3 Investigate cost of securing finance on optimal terms

3.4 Identify strategies to obtain finance as required to ensure financial viability of the business

Evidence of the ability to:

develop a financial plan which identifies financial requirements of the business, including cash flow projections and a projected profit statement

follow the financial plan, including:

demonstrating an awareness of appropriate legal requirements

implementing strategies to monitor financial performance

identify sources and investigate costs of securing appropriate financial assistance.

Note: If a specific volume or frequency is not stated, then evidence must be provided at least once.

To complete the unit requirements safely and effectively, the individual must:

explain breakeven analysis

clarify costing for the business, including margin or markup, hourly charge-out rates and unit costs

summarise financial decision-making relevant to the business

outline methods and relative costs of obtaining finance

summarise principles for preparing balance sheets

provide a detailed explanation of:

principles for preparation of cash flow forecasts

principles for preparation of profit and loss statements

purpose of financial reports

explain relevant accounting terminology

describe working capital cycles.

Assessment must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the Management and Leadership – Small and Micro Business field of work and include access to:

software for financial calculations

relevant legislation, regulations, standards and codes

relevant workplace documentation and resources

case studies or where possible, real situations.

Assessors of this unit must satisfy the requirements for assessors in applicable vocational education and training legislation, frameworks and/or standards.

Submission Requirements

List each assessment task's title, type (eg project, observation/demonstration, essay, assingnment, checklist) and due date here

Assessment task 1: [title]      Due date:

(add new lines for each of the assessment tasks)

Assessment Tasks

Copy and paste from the following data to produce each assessment task. Write these in plain English and spell out how, when and where the task is to be carried out, under what conditions, and what resources are needed. Include guidelines about how well the candidate has to perform a task for it to be judged satisfactory.

ELEMENT

PERFORMANCE CRITERIA

Elements describe the essential outcomes.

Performance criteria describe the performance needed to demonstrate achievement of the element.

1. Identify costs, calculate prices and prepare profit statement

1.1 Identify and document costs associated with production and delivery of business products and services

1.2 Calculate prices based on costs and profit margin, as an hourly charge-out rate for labour or unit price for products

1.3 Calculate breakeven sales point to establish business viability and profit margins

1.4 Identify appropriate pricing strategies in relation to market conditions to meet business profit targets

1.5 Prepare projected profit statement to supplement the business plan

2. Develop a financial plan

2.1 Set profit targets or goals to reflect owner’s desired returns

2.2 Identify working capital requirements necessary to attain profit projections

2.3 Identify noncurrent asset requirements and consider alternative asset management strategies

2.4 Prepare cash flow projections to enable business operation in accordance with business plan and legal requirements

2.5 Identify capital investment requirements accurately for each operational period

2.6 Select budget targets to enable ongoing monitoring of financial performance

3. Acquire finance

3.1 Identify startup and ongoing financial requirements according to financial plan/budget

3.2 Identify sources of finance, including potential financial backers, to provide required liquidity for the business to complement business goals and objectives

3.3 Investigate cost of securing finance on optimal terms

3.4 Identify strategies to obtain finance as required to ensure financial viability of the business

Evidence of the ability to:

develop a financial plan which identifies financial requirements of the business, including cash flow projections and a projected profit statement

follow the financial plan, including:

demonstrating an awareness of appropriate legal requirements

implementing strategies to monitor financial performance

identify sources and investigate costs of securing appropriate financial assistance.

Note: If a specific volume or frequency is not stated, then evidence must be provided at least once.

To complete the unit requirements safely and effectively, the individual must:

explain breakeven analysis

clarify costing for the business, including margin or markup, hourly charge-out rates and unit costs

summarise financial decision-making relevant to the business

outline methods and relative costs of obtaining finance

summarise principles for preparing balance sheets

provide a detailed explanation of:

principles for preparation of cash flow forecasts

principles for preparation of profit and loss statements

purpose of financial reports

explain relevant accounting terminology

describe working capital cycles.

Assessment must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the Management and Leadership – Small and Micro Business field of work and include access to:

software for financial calculations

relevant legislation, regulations, standards and codes

relevant workplace documentation and resources

case studies or where possible, real situations.

Assessors of this unit must satisfy the requirements for assessors in applicable vocational education and training legislation, frameworks and/or standards.
Copy and paste from the following performance criteria to create an observation checklist for each task. When you have finished writing your assessment tool every one of these must have been addressed, preferably several times in a variety of contexts. To ensure this occurs download the assessment matrix for the unit; enter each assessment task as a column header and place check marks against each performance criteria that task addresses.

Observation Checklist

Tasks to be observed according to workplace/college/TAFE policy and procedures, relevant legislation and Codes of Practice Yes No Comments/feedback
Identify and document costs associated with production and delivery of business products and services 
Calculate prices based on costs and profit margin, as an hourly charge-out rate for labour or unit price for products 
Calculate breakeven sales point to establish business viability and profit margins 
Identify appropriate pricing strategies in relation to market conditions to meet business profit targets 
Prepare projected profit statement to supplement the business plan 
Set profit targets or goals to reflect owner’s desired returns 
Identify working capital requirements necessary to attain profit projections 
Identify noncurrent asset requirements and consider alternative asset management strategies 
Prepare cash flow projections to enable business operation in accordance with business plan and legal requirements 
Identify capital investment requirements accurately for each operational period 
Select budget targets to enable ongoing monitoring of financial performance 
Identify startup and ongoing financial requirements according to financial plan/budget 
Identify sources of finance, including potential financial backers, to provide required liquidity for the business to complement business goals and objectives 
Investigate cost of securing finance on optimal terms 
Identify strategies to obtain finance as required to ensure financial viability of the business 

Forms

Assessment Cover Sheet

BSBSMB402 - Plan small business finances
Assessment task 1: [title]

Student name:

Student ID:

I declare that the assessment tasks submitted for this unit are my own work.

Student signature:

Result: Competent Not yet competent

Feedback to student

 

 

 

 

 

 

 

 

Assessor name:

Signature:

Date:

Assessment Record Sheet

BSBSMB402 - Plan small business finances

Student name:

Student ID:

Assessment task 1: [title] Result: Competent Not yet competent

(add lines for each task)

Feedback to student:

 

 

 

 

 

 

 

 

Overall assessment result: Competent Not yet competent

Assessor name:

Signature:

Date:

Student signature:

Date: